Nepal decides to form negotiating team to discuss AIIB financing for power distribution network

Source: Xinhua| 2019-11-08 01:10:10|Editor: yan
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KATHMANDU, Nov. 7 (Xinhua) -- Nepali government has decided to start negotiation with Asian Infrastructure Investment Bank (AIIB) on receiving loan worth 112.3 million U.S. dollar for the construction of electricity distribution lines, a senior Nepali government minister said on Thursday.

During a regular press briefing, Nepali government's spokesperson and Minister for Communication and Information Technology Gokul Baskota said that a recent cabinet meeting decided to form a negotiation team headed by joint secretary Nepal's Finance Ministry.

The project 'Power Distribution System Upgrade and Expansion Project' aims to increase access to and improve quality and efficiency of electricity supply in selected areas of Western Nepal.

If approved by the bank's board, it will be the second project where the China initiated bank will be financing in Nepal. In June, the AIIB had announced providing loan up to 90 million U.S. dollar for 216 MW Upper Trishuli-1 Hydropower Project to be developed on Trishuli river in central Nepal, as its first financing to Nepal. Nepali is one of the founding members of the the AIIB.

The estimated cost of this power distribution project is 135 million U.S. dollar, according to project proposal. Nepali government will contribute 17 million U.S. dollar and Nepal Electricity Authority (NEA), state-owned power utility body, which is implementing this project, will contribute 6.5 million. The NEA which is sole power utility body of Nepal has been struggling to ensure uninterrupted power supply due to poor distribution infrastructure despite officially ending the load shedding across the country since last year.